ACTA SCIENTIARUM POLONORUM Czasopismo naukowe założone w 200l roku przez polskie uczelnie rolnicze Oeconomia Economics Ekonomia 11 (1) 2012 Bydgoszcz Kraków Lublin Olsztyn Poznań Siedlce Szczecin Warszawa Wrocław Acta Scientiarum Polonorum Programming Board Kazimierz Banasik (Warsaw), Janusz Falkowski (Olsztyn), Florian Gambuś (Krakow), Franciszek Kluza (Lublin), Edward Niedźwiecki (Szczecin), Janusz Prusiński (Bydgoszcz), Jerzy Sobota (Wrocław) – chairman, Stanisław Socha (Siedlce), Waldemar Uchman (Poznan) Oeconomia Scientifi c Board Carol J. Cumber (South Dakota State University, Brookings, USA), Michael Ireland (University of Exeter, UK), Roman Kisiel (University of Warmia and Mazury in Olsztyn), Vera Majerova (Czech University of Life Sciences, Prague), Wiesław Musiał (University of Agriculture in Krakow), Janina Sawicka (Faculty of Economic Sciences – Warsaw University of Life Sciences) – chairperson,Grzegorz Spychalski (Koszalin University of Technology), Harun Ucak (Nigde University, Turkey), Dorota Witkowska (Faculty of Applied Mathematics and Computer Science – Warsaw University of Life Sciences) Oeconomia Secretary Mirosława Braja (Warsaw University of Life Sciences) e-mail: [email protected] Editorial staff Jan Kiryjow, Krystyna Piotrowska ISSN 1644-0757 © Copyright by Warsaw University of Life Sciences Press Wydawnictwo SGGW, ul. Nowoursynowska 166, 02-787 Warszawa tel. (22) 593 55 20 (-22; -25 – sprzedaż), fax (22) 593 55 21 e-mail: [email protected] www.wydawnictwosggw.pl Print: Agencja Reklamowo-Wydawnicza A. Grzegorczyk, www.grzeg.com.pl From the Scientifi c Board There has been the eleventh year of the Acta Scientiarum Polonorum Oeconomia publishing. The Acta is the periodical including several thematic series with uniform graphics and similar format. The publication was set up by group of enthusiasts – em- ployees of agricultural universities and has been published under the patronage of rectors of these universities. Current involvement of academic society in increasing substantive and editorial level of the series, with efforts of the authors, the Programming Board and the Scientifi c Boards, has contributed to placing the Acta Scientiarum Polonorum (and our Oeconomia series) on the noticeable position in academic research society. Articles can be prepared in Polish with English titles, abstract and keywords. Moreover, we pub- lish also issues in English only. The Scientifi c Board of the Oeconomia series, concerning the publication range, focus their attention both on substantive content and precision of the form. The articles are revised in “double-blind review” process. All issues of the Acta Scientiarum Polonorum Oeconomia are available in electronic version on the fol- lowing website http://acta_oeconomia.sggw.pl and abstracts on http://www.acta.media. pl. We are glad to inform that Acta Scientiarum Polonorum Oeconomia are included in EBSCO’s library database. Please send the articles on one of following e-mail addresses: [email protected] [email protected] While sending a printout, please attach also the electronic version on CD or DVD. Letters including note “the Acta Scientiarum Polonorum Oeconomia” should be sent on the following address: Prof. dr hab. Janina Sawicka Department of European Policy, Public Finances and Marketing Faculty of Economic Sciences Warsaw University of Life Sciences Nowoursynowska 166, 02-787 Warsaw, Poland tel.: (+4822) 593 40 70; fax: (+4822) 593 40 77 Yours sincerely, Prof. dr hab. Janina Sawicka Chairperson of the Scientifi c Board of the Acta Sci. Pol. Oeconomia series Oeconomia 11 (1) 2012, 5–21 LIVING STANDARD, QUALITY OF LIFE, GLOBALIZATION AND COMPETITIVENESS IN THE EU AND THE NEIGHBOUR COUNTRIES – AN EMPIRICAL ANALYSIS Michael Olsson, Bernd-Joachim Schuller University of Skövde1 Abstract. This paper deals with the theoretical and empirical relations between living standard, quality of life, globalization and international competitiveness of countries. While economists are not convinced that competitiveness of countries is a useful concept, because fi rms and industries compete economically and not countries, the general public, journalists and politicians seem to feel that competitiveness is important. E.g., one of the goals of the European Union is to become the most competitive economy in the world. Furthermore, economists argue, that economic globalization has the potential of increasing economic welfare for all. In this case, the general public is more sceptical. Finally, the general public but even other scientists than economists, seem to believe that living standard and the qual- ity of life are only weakly related to each other. The following results can be mentioned. We found strong positive correlations between our main variables. Our hypotheses are with other words supported. Key words: Living standard, quality of live, globalization, competitiveness, Gross Domes- tic Product, the Lisbon Agenda, correlations, European countries INTRODUCTION Economists, politicians and journalists are concerned about whether economic de- velopment and growth are sustainable or not. Environmental, climate and population changes could have a negative infl uence on the economic situation and development. While economic development often is described by GDP in total and GDP per head of population, the question is whether these measures are connected with welfare (see e.g. [Vogel & Wolf 2004]). After all, GDP is a measure of production, incomes and fi nal de- mand. Therefore it is often asked, how living standard and the quality of life is infl uenced Corresponding authors: Michael Olsson, Bernd-Joachim Schuller, University of Skövde, School of Technology and Society, P.O. Box 408, S-541 28 Skövde, Sweden, email: [email protected], [email protected] 6 M. Olsson, B.-J. Schuller by GDP and GDP per head of population (GDP pc). Furthermore, people are concerned about the connection between globalization and national living standard. Finally, it is of- ten asked, whether it is important for a country to be internationally competitive to cope with the challenges of globalization and to be able to make a rising living standard and quality of life possible for its citizens. This work is inspired by Koreleski [2007], and is based on the work presented in Schuller [2008] and Schuller [2009a]. We use here a similar approach, but chose a larger number of countries and a wider perspective by including globalization and international competitiveness. The purpose of the project is to analyse theoretically and empirically the connections between globalization and international competitiveness on one hand and average living standards and the quality of life on the other hand. The paper is organized in the following way. After the introduction, section 2 presents some methodological remarks. In section 3 the empirical variables and relations are dis- cussed and hypotheses are formulated in a rather intuitive way. Section 4 describes the size of Europe, measured as population and GDP. Section 5 mentions some previous results. In section 6 we present correlations between variables and rankings of countries. Section 7 consists of the summary. In section 8 the references are shown. Appendix 1, Appendix 2 and Appendix 3 fi nish the paper. SOME METHODOLOGICAL REMARKS In our investigation, we use several variables: GDP per person, the human develop- ment index, the global competitiveness index and others. Some of the variables are indi- ces. For example, the UN constructed the human development index as a combination of several components. When you create an index, you have many alternatives to consider. Each component, c, included in the index has a specifi c weight, w. You need to determine what components to use, and how important they are. An index is often calculated as a weighted sum of index components: Iwc ¦ ii. An alternative construction of an index i is to use a multiplicative structure, Iwc ii. Many choices have to be made, and there i is no correct construction. In some cases, a country performs relatively well, while in other it does not. For a fuller description of these issues we refer you to Hagén et al [2003] and Olsson [2010]. To some extent, you can form an index to get to the result you want. Lobbyists and political parties use it to argue in favor of their agenda [Olsson 2010]. In our comparisons, we use all indices as they are. We have not changed the components or their weights. We want to investigate if two variables are related, and if so to what degree. We use correlation as the measure of association. Let us call one variable x and one y. We relate the variables to each other: yx DE H. VVxy The correlation between them is U . V xy Acta Sci. Pol. Living standard, quality of life, globalization and competitiveness... 7 In Figure 1, you fi nd an illustration of the case with no correlation between the vari- ables to the left. In the right graph, the correlation is positive, but not perfect. Variables can be related for many reasons: i) there may be an underlying factor infl u- encing both variables, ii) one variable may cause the effect on the other, or iii) both vari- ables infl uence each other in a simultaneous system. In this investigation we often expect positive correlation for these reasons. For a detailed description we refer you to Rodgers and Nicewander [1988]. Fig. 1. To the left: No correlation between the two variables, U 0. To the right: A positive cor- relation, 01U , between the two variables Rys. 1. Po lewej stronie: brak korelacji pomiędzy